FORT WORTH, TX—Following a three-day trial before U.S. District Judge Reed C. O’Connor, a federal jury has convicted Dr. Abbas Zahedi of Carrolton, Texas, and Reginald Guy of Arlington, Texas, on all counts of a superseding indictment charging each with one count of conspiracy to commit health care fraud, five counts of health care fraud and four counts of aggravated identity theft. Following the verdicts, both defendants were remanded to the custody of the U.S. Marshal. U.S. Attorney Sarah R. Saldaña of the Northern District of Texas made the announcement today.

Zahedi, 49, a chiropractor, owned and operated DFW Rehab & Diagnostics (DFW) out of the office of Metroplex DFW Sports Rehab Center (Metroplex) in Arlington and later at a stand-alone location in Grand Prairie, Texas, until it closed in September 2012.

Guy, 44, worked at a factory in Arlington, and from approximately 2003 until 2009, he was a union representative. His employment was terminated in November 2009.

The government presented evidence at trial that from 2009 to 2012, Dr. Zahedi and Reginald Guy, along with four coconspirators, James Sterns, Tina Perkins, Donna Harris and Gregory Wattron, conspired to submit health insurance claims to Blue Cross Blue Shield of Texas (BCBS) and other insurers for services not rendered. Sterns, Perkins, Harris and Wattron have pleaded guilty to their respective roles in the conspiracy and are scheduled to be sentenced by Judge O’Connor on September 15, 2014.

Guy used as his role as a union representative at the factory to recruit and refer his co-workers to Metroplex, where, in exchange for monthly kickbacks, work excuse notes and a variety of prizes, they agreed to allow their insurance company to be billed for services they did not receive.

Sterns, 50, of DeSoto, Texas, owned and operated Metroplex. In early 2010, Sterns hired Guy, whose employment at had been terminated, to be the office manager of Metroplex. Guy served as Metroplex’s office manager from 2010 to mid-2011, shortly before the clinic closed. In March or April 2011, Dr. Zahedi hired Guy as a consultant for DFW at its Grand Prairie location. After Guy began working for Dr. Zahedi, Guy helped transfer patients and patient information from Metroplex to Dr. Zahedi at DFW, where the fraudulent referral and billing scheme continued.

Tina Perkins, 43, of Dallas, was responsible for submitting claims to insurance companies and also worked as the biller and office consultant for Dr. Zahedi at DFW. Perkins’ sister-in-law, Donna Harris, 43 of Haltom City, Texas, permitted Metroplex, in exchange for cash payments, to submit claims to BCBS for services purportedly performed by Dr. Zahedi and Wattron, when in fact she received no treatment. In early 2011, Dr. Zahedi hired Harris to be the office manager at DFW’s location in Grand Prairie. As such, she continued to allow Dr. Zahedi to submit claims under her name to BCBS for services that were not performed. Harris also permitted Dr. Zahedi to submit claims to BCBS for Harris’ immediate and extended family members for services they did not receive. Wattron, 56, of Grapevine, Texas, was an occupational therapist at Metroplex from approximately 2008 until July 2011 and at DFW from June 2010 through August 2011. Wattron agreed to allow Sterns and Dr. Zahedi bill insurance companies for occupational therapy that he did not perform.

Dr. Zahedi and Guy face a maximum statutory penalty of 10 years in federal prison and a $250,000 fine for the conspiracy count and each of the substantive health care fraud counts. Each count of aggravated identity theft carries a maximum statutory penalty of two years. They are scheduled to be sentenced on November 17, 2014.

The FBI and the Office of Personnel Management—Office of Inspector General investigated. Assistant U.S. Attorney Nancy Larson and Special Assistant U.S. Attorney Douglas Brasher are prosecuting the case.